Construction Growth Target Revised Upward
FMI Forecasts 6 Percent Expansion in 2015
Manufacturing, lodging and a few other sectors should be the leading drivers of growth in the construction industry this year. FMI expects total building activity to expand by 6 percent in 2015, according to its third-quarter Construction Outlook.
A leading construction industry consultant has revised its 2015 forecast of building growth, increasing it one point to 6 percent.
FMI had predicted a nationwide expansion rate of 5 percent in its second-quarter Construction Outlook, but changed that prediction in its recently released third-quarter report.
The company is a leading provider of management consulting services to the engineering and construction industries, and is also estimating building activities will climb by 7 percent in 2016. If it does reach that level, it would be the highest total since 2008.
Manufacturing is currently the fastest-growing sector, and FMI anticipates it will grow 18 percent in 2015. But FMI also said that pace would drop to 5 percent the following year.
Lodging is also growing rapidly, and FMI has forecast its expansion at 15 percent in 2015, followed by a 12 percent hike in 2016. That pace should decrease to 8 percent in 2017.
Office building is going strong at the moment, and should hit 15 percent this year. This pace will slow a bit in 2016, FMI said, but growth should remain steady.
Residential construction has declined somewhat after three years of solid results. Growth in single-family construction is estimated to reach 9 percent, and the multifamily segment is anticipated to reach 11 percent.
Power construction had a strong showing in 2014, and while it will slip to 8 percent in 2015, it is expected to regain 3 percent of that in 2016.
FMI was founded in 1953 by Dr. Emol A. Fails, and maintains offices across the U.S. Some of its services include market research and business development; leadership and talent development; and mergers, acquisitions and financial consulting.
Employment in the construction industry gained some ground in September, expanding by 8,000 jobs, the Associated Builders and Contractors reported.
Nonresidential builders and specialty trade contractors combined for 6,800 of the new jobs, while the heavy and civil engineering category declined by 2,200.
"Construction was one of the few bright spots in today's report, as residential and nonresidential construction remain two of the nation's five leading growth segments," Anirban Basu, chief economist for the ABC, said. "The industry's unemployment rate is down 1.5 percentage points from September 2014 and is essentially at its lowest point in eight years."
Nonresidential construction added 1,200 jobs for the month, and is up by 14,300 jobs, or 2 percent, since September 2014.
Residential building grew by 800 jobs in September, and has increased by 20,400 jobs, or 3 percent, on a year-to-year basis.
Nonresidential specialty trade contractors expanded by 5,600 jobs for the month. It is up by 68,100 jobs, or 3.1 percent, on an annual basis.
Residential specialty trade contractors grew by 3,100 jobs in September. This group has added 79,600 jobs, or 4.7 percent, compared to the same month in 2014.
The heavy and civil engineering construction segment shed 2,200 jobs for the month, but employment is up by 23,200 positions, or 2.5 percent, year-to-year.